Mothers' postdivorce earnings in the context of welfare policy change

INTERNATIONAL JOURNAL OF SOCIAL WELFARE

DOI: 10.1111/ijsw.12205 Int J Soc Welfare 2016: 25: 222–234

ISSN 1369-6866

Mothers’ postdivorce earnings in the context of welfare policy change Herbst A., Kaplan A. Mothers’ postdivorce earnings in the context of welfare policy change We examined in this study the implications of divorce for mothers’ earnings, comparing the 1990s and the 2000s, and illuminating developments in welfare policy for single-parent families over those two decades. After the welfare reform of 2003, the economic autonomy of single mothers, established through a combination of welfare state-based benefits and paid labour, was delegitimised, with a turn toward the marketplace. Using a unique data set created for this research by merging Israeli census files for 1995–2008, annual administrative employment records from the National Insurance Institute and the Tax Authority, and data from the Civil Registry of Divorce, we found that most mothers tended to increase their income from paid labor following divorce. However, they did so significantly more prior to the welfare cuts than after the cuts. The results can inform policy discussions about how mothers’ postdivorce earnings might be affected by welfare policy shifts.

Introduction The implications of divorce for single mothers’ earnings across two periods of time were studied, observing developments in welfare legislation affecting single-parent families in Israel over that time. The rise in the number of such families has been a prominent social development since the last quarter of the 20th century (Fogiel-Bijaoui, 2002; Hacker, 2012; Kilkey, 2000; Millar & Rowlingson, 2001; Orloff, 2001). One of the common characteristics of single mothers in many countries is their poverty rates, which are significantly higher than for the rest of the population. In the vast majority of cases, such families are headed by divorced mothers (in Israel, the rate is 66% of all single-parent families with children; Toledano & Wasserstein, 2014). There is abundant research reporting a significant decline in the economic wellbeing of women (and children) in the postdivorce period (see e.g., Andreß et al., 2006; Manting & Bouman, 2006; Tach & Eads, 2015). These adverse economic effects have been linked to the lower academic achievement found among children of single parents (Amato, 2010; Weitoft et al., 2004). The high rate of divorce and its economic consequences, particularly for women, has given rise to state policies targeted at the single-parent household, especially with respect to integration into the job market (Abramovitz, 2006; Millar & Ridge, 2009; Stier, 222

Anat Herbst1, Amit Kaplan2 1

Gender Studies, Bar Ilan University, Ramat Gan, 5290002, Israel 2 Tel Aviv-Yaffo Academic College, Israel

Key words: divorce, social welfare policy, gender, single mothers, family policy, earnings/wages, the labor market, quantitative research Anat Herbst, Bar Ilan University, Gender Studies, Ramat Gan 5290002, Israel E-mail: [email protected] Accepted for publication November 26, 2015

2011). Welfare practices (e.g., benefits, social services) affect the risk of falling into poverty and being unable to maintain autonomous households (Lewis & Hobson, 1997; Millar & Rowlingson, 2001). Whereas in some welfare states, single mothers are expected to be “full-time caregivers” for their children, in others they are also expected to work (Kilkey, 2000). Influenced by a neoliberal ideology, the end of the 20th century saw the beginning of a global policy of “activation,” that is, a gradual attempt to integrate single mothers into the workforce, accompanied by welfare-to-work programs and increasingly strict means- and employment tests for welfare entitlement (Cook, 2012; Skevik, 2005). Feminist theorists have conceptualised the term “economic autonomy” as the ability of mothers to maintain an independent household even if they lack access to a husband’s salary (Orloff, 2001), and as the ability to leave the marriage (Hobson, 1990). Economic autonomy can be made possible by supporting mothers who have paid employment and through various mechanisms of the welfare state, such as social assistance. In Israel, single mothers in general, and divorced mothers in particular, are highly vulnerable to poverty. In the 1990s, the economic autonomy of single mothers was established through a combination of benefits and paid labor. However, beginning in 2003, Int J Soc Welfare 2016: 25: 222–234

C 2016 The Author(s). International Journal of Social Welfare V C 2016 International Journal of Social Welfare and John Wiley & Sons Ltd V

Mothers’ postdivorce earnings in Israel

the political climate has undermined the legitimacy of welfare state-based economic autonomy, and since then the welfare state model has turned towards the market. Although this type of economic autonomy, contingent upon annuities and based on means testing, has received criticism from some feminist writers (e.g., Gordon, 1994), it still reduces the risk that divorced mothers will fall into poverty and therefore ensures some measure of economic autonomy, especially for those mothers who belong to disadvantaged ethnic groups (Abramovitz, 2006; Orloff, 1996, 2001). Israel constitutes an important case study, not only because of the shift in welfare policy (see also Herbst, 2013), but also because Israel is classified as belonging to the Mediterranean welfare state regime (Gal, 2010). This regime is characterised, among other things, by the marked influence of religion on the structuring and functioning of its welfare state institutions. Marriage is more institutionalized in these nations, and the proportion of single-parent households is generally much lower in Mediterranean welfare states than it is in Social-Democratic or Liberal welfare states. These countries have also had limited success in alleviating poverty and overcoming social and economic gaps (Gal, 2010). In addition, Israel has a high fertility rate coupled with the strong labor force participation of mothers, particularly mothers of young children (OECD, 2014). As in previous studies (McKeever & Wolfinger, 2001; Raeymaeckers et al., 2008; Raz-Yurovich, 2013; Van Damme et al., 2009), the current research focused on uncovering change in the economic autonomy of Israeli mothers, as reflected in their earnings before and after divorce. Following the analytical strategy of Styrc and Matysiak (2012) and of Tamborini et al. (2012), we examined the change in mothers’ earnings following divorce in two time periods that represent two paths of policies targeted at single-parent families. Most research on stratification issues of divorce in Israel (Katz & Peres, 1996; Lewin, 2006; Raz-Yurovich, 2012, 2013) and elsewhere has focused on the micro level and has not taken into account the broader perspective of the political economy (H€ark€ onen & Dronkers, 2006; Kaplan & Stier, 2011). In contrast, this study has added a significant dimension, that is, the effect of divorce on employment and earnings, examining how the shift in welfare policy might be related to economic consequences for divorced mothers. Another contribution of this study is the use of updated data to examine changes in mothers’ earnings following divorce in Israel. Divorce rates doubled from the early 1970s to the late 1990s, attaining a certain level of stabilisation in the 2000s

(CBS, 2013). Moreover, there has been a concomitant rise in single-parent families as a result of divorce (Toledano & Wasserstein, 2014). Notwithstanding, studies on the economic implications of divorce in Israel are rare (but see Raz-Yurovich, 2013, who used data up to the mid-1990s). Our research questions are twofold: (1) How does divorce affect mothers’ earnings? and (2) How have these consequences changed across the two time periods? After introducing current findings on the implications of divorce for earnings and labor market participation, we present changes in welfare policy directed at single mothers in Israel. The economic implications of divorce and welfare policy In recent decades, the rise in the divorce rate has been one of the most striking changes in capitalist countries (Amato, 2010; Blossfeld & Muller, 2002). This highlights the need to examine the economic implications of divorce in general and the changes in earnings in particular, as this constitutes the main crux of single mothers’ economic survival when they are urged by the state to enter the job market (Andreß et al., 2006; Duncan & Edwards, 1997). As women’s quality of life may decrease after divorce due to an inability to overcome the “salary penalty” (Raz-Yurovich, 2013), women often turn to employment to compensate for income loss. Research has shown that in some countries there is a marked tendency on the part of women to enter the job market following divorce. In studies of the situation in the USA, Couch et al. (2013) and Tamborini et al. (2012, 2015) found that from the early 1970s to the early 2000s there was a significant increase in women’s earnings following divorce, while McKeever and Wolfinger (2001) found a significant increase of employment among divorced women. This has also been found in France (Bonnet et al., 2010), The Netherlands, Denmark, Italy (Van Damme et al., 2009) and Israel (Raz-Yurovich, 2013). RazYurovich (2013) has shown that divorced salaried women in Israel have increased their level of economic activity through continuous and stable employment and by taking on extra jobs. In contrast, a study of 13 EU countries (Van Damme et al., 2009) found a relatively small rise in employment following separation, although this finding was more significant in some countries than in others. Changes in employment were also found to be small among divorced women in Canada (Mueller, 2005). In the UK (Jarvis & Jenkins, 1999; Van Damme et al., 2009), it was found that the presence of divorced women in the job market had decreased.

Int J Soc Welfare 2016: 25: 222–234 C 2016 The Author(s). International Journal of Social Welfare V C 2016 International Journal of Social Welfare and John Wiley & Sons Ltd V

223

Herbst & Kaplan

According to Van Damme et al. (2009), changes in employment among divorced women in these 13 EU countries were positively affected by level of education, experience in the job market and good health, and were adversely affected when there were young children at home. Generous childcare benefits tend to encourage separated women to enter the job market, whereas generous social welfare benefits tend to have the opposite effect. Furthermore, McKeever and Wolfinger (2001) found that women of more advanced employment positions often improved their financial situation after divorce. In a comparative study of European countries in which men’s and women’s strategies for coping with the economic consequences of separation were examined, Jansen et al. (2009) found that women and older divorcees with children were less able to increase their income than were their younger, childless counterparts. This led the researchers to conclude that there is a significant need for public solutions, such as providing childcare and promoting employment opportunities for women in general and mothers in particular, in order to prevent women and children from falling into poverty. This supposition accords with the findings of Uunk (2004) who studied what effect welfare state measures (i.e., childcare and single-parent family benefits) in 14 European countries had on the income and employment of divorced women. Uunk found that generous benefits for single-parent families and the presence of public childcare facilities that enabled divorced mothers to increase their job market participation reduce the adverse economic consequences of divorce for women. Thus, Uunk asserted, women’s employment and economic status are expressed at the micro levels of the welfare state rather than through general welfare policies. His approach measures the influence of “domainspecific” policy characteristics, such as benefits and public childcare facilities. In contrast, Raeymaeckers et al. (2008), studying formal and nonformal childcare in 13 countries, claimed that changes in working hours before and after divorce are related to a country’s institutional environment. In Raeymaeckers et al’s approach, a specific institutional environment is more than the sum of its parts, and the approach uses an index that represents a country’s policy package. The above studies indicate that, in some countries, welfare solutions strengthen the position of divorced women in the job market. Welfare policy encourages employment for women by offering a wide range of childcare frameworks, extended maternity leave, and a broad public sector that provides job opportunities suitable for parents (Mandel & Semyonov, 2005). The welfare policy that encourages women to enter the job market thus improves the economic situation of their families following a divorce (Raeymaeckers et al., 2008; Uunk, 2004). 224

Maintenance benefits enable mothers to provide full-time care for their children as a right granted in their role as caretakers, and offer a safety net that allows underprivileged women to maintain autonomous homes or to exit a marriage. Benefit cuts affect segments of the population that have traditionally relied on public assistance, particularly low-paid single mothers and ethnic and racial minorities with high rates of poverty and unemployment. Cutbacks in social rights have reduced support for caretaking and childbirth and have given added emphasis to the importance of the market (Orloff, 2001). This shift toward the centrality of the market and dual-earner households emphasises gender sameness, as both mothers and fathers are required to be employed (Hobson et al., 2002; Orloff, 2001). This is in accordance with the market model in which private solutions based largely on the market are preferred over state intervention in family matters. In this model, women are more dependent on the labor market than on the welfare state, and the economic cost of divorce is greater (Andreß et al., 2006). Changes in welfare policy affecting single-parent families in Israel Since the early 1990s, Israel has witnessed two main configurations of policy regarding single-parent families, the first occurring between 1992 and 2003, and the second between 2003 and the present. The SingleParent Family Law of 1992 was designed to anchor the rights of single parents (Toledano & Wasserstein, 2014). It amended certain aspects of the 1980 Income-Support Law which ensured a minimum subsistence allowance to all poverty-stricken residents who could not obtain a sufficient income, based on strict means- and employment tests. The incomesupport benefit offered regular and enhanced rates, and in 1980 enhanced benefits were automatically applied only to widowed mothers; other single mothers were entitled to enhanced benefits only after two years of income support. The Single-Parent Family Law of 1992 changed this situation, applying the enhanced benefits to all single mothers who were receiving income support. It also widened the circle of potential recipients by eliminating the income ceiling above which eligibility for benefits was denied. This legislation thus offered compensation for mothers’ childcare function (Helman, 2011) and created equality before the law for widows, divorcees, unmarried and separated women, serving as the welfare state’s primary tool to combat poverty among single mothers (Herbst, 2009). Moreover, the 1992 law established other in-kind benefits, such as subsidised day care, discounts on municipal taxes, and subsidised housing. These reforms allowed women to establish Int J Soc Welfare 2016: 25: 222–234



and maintain households independent of a male breadwinner (Helman, 2011). Note that the law targeted single mothers living in poverty and was not a universal entitlement, with the exception of study grants for children aged 6–14 awarded once a year. In 1994 and 1995, two laws enacted to fight poverty increased the benefit rate. Indeed, the poverty of single mothers in Israel decreased between 1995 and 2003 (Flug et al., 2006). Contrary to the assumptions of the policy makers, the Income-Support Law did not reduce the presence of single mothers in the job market (Frish & Zussman, 2008); instead their labour market participation rate was higher than that of married mothers (Toledano & Eliav, 2011). The political structure that had offered benefits to support single mothers collapsed in the first decade of the 21st century. That period saw a significant change in the approach to paid labor. The primary goal of the policy was to significantly reduce the benefits paid out to single-parent families. This approach is typical of neoliberal ideology, which views welfare benefits as generating dependence on the welfare state (Ajzenstadt, 2009; Doron, 2005; Herbst, 2013). The reform culminated in cutbacks in child-support (payment-assurance) benefits by approximately one third. According to this law, mothers and children who do not receive the child support due them by fathers are guaranteed a modest allowance, while the National Insurance Institute assumes responsibility for collecting payment from the debtor. Entitlement to this benefit is dependent on means tests. In addition, universal benefits for children under 18 were cut by approximately one half. The reform further amended the 1980 Income-Support Law, which had ensured a minimum subsistence allowance to all residents who could not obtain a sufficient income. Entitlement to this benefit was dependent on both means- and employment tests. The reform added employment tests for mothers of children above the age of two, as opposed to seven, which had been the case before. The 2003 cutbacks inflicted on paid workers were even more severe in that the portion of the benefit that was not affected by income was reduced (Achdut et al., 2005). Known as the “disregard” (exempted income), this benefit allows low-wage employees to both work and receive an allowance (Doron & Gal, 2000). Cuts in the “disregard” affected the earning power of low-income workers, making it less lucrative to have paid employment. This particularly hurt low-income mothers, many of whom were no longer entitled to receive an allowance to supplement their wages (Achdut et al., 2005). Studies, for example by Blank et al. (2000), indicate that a higher “disregard” boosts employment and reduces poverty. Another financial penalty levied on paid workers was lowering the total income ceiling that entitles families to

income support. Before the cutbacks, single-parent families could receive a relatively high income from employment and keep their benefits, in comparison with other types of families (Gal & Doron, 2000; Morginstein & Shmeltser, 2000). Besides the salary penalty, these cuts and changes in the income support structure involving work disincentives related to an income ceiling (similar to “wage stop”) exacerbated the “poverty trap” (see Gal & Doron, 2000) among single-parent families in Israel. This policy reform constituted one of the most profound changes in social welfare benefits that the Israeli welfare state had ever seen (Doron, 2005). As in the United States (Woodward, 2008) and Britain (Williams, 2001), neoliberalism in Israel strengthened the market citizenship model according to which employment means independence and independence implies “good citizenship” (Breitkreuz, 2005). Thus, the welfare policy aimed at driving single mothers into the job market and decreasing their reliance on benefits. Indeed, compared with the about 28,000 recipients of child support (payment assurance) in 2002, the number decreased to 19,000 in 2012. Similarly, the number of single-parent recipients of income support dropped from about 52,000 in 2002 to 25,000 (NII, 2013). The new welfare policy did not result in any economic advancement for single-parent families, but in fact increased their level of poverty, from 25.2% in 2002 to 32.3% in 2009, despite the welfare benefits they received (Endeweld et al., 2009; NII, 2003). As before the reform, the employment rate of single mothers was higher than that of married mothers (Toledano & Wasserstein, 2014). Yet, they were penalised for paid work because of the retrenchment of the “disregard” and the availability of only lowpaying jobs (Achdut et al., 2005). Focusing on divorced mothers in Israel, the current research examined the implications of divorce for their earnings in the context of the described welfare policy changes. We thus offer a comparative study of the economic implications of divorce for mothers across two policy patterns: (1) when women’s autonomy was facilitated by the welfare state (Orloff, 2001); and (2) when there were welfare cuts and a shift toward a market model. We also examined the effects of socioeconomic resources, as well as family and demographic characteristics, on the change in earnings following divorce. Methodology Data The study is based on a unique database created especially for our project. The data come from the combined census files for 1995–2008, which were matched to annual work history data and income tax


225

Herbst & Kaplan

data for each year from the NII and Tax Authority, as well as the civil registry of divorce (via the CBS). The match rate between the NII, tax authority, and census files was 95%. Since there are no individuallevel longitudinal data sets in Israel for the two periods under study, this unique combination of datasets from several sources enabled us to create panel data tracing the mothers for 13 years. Annual data for each mother included information about yearly earnings from paid work and the mother’s marital status in that year. The other independent variables that appear in the analysis (e.g., education, ethnicity) are based on the 1995 census. Using this dataset offered three major advantages. First, it provided longitudinal panel information on our main research variables—namely, marital status and labor force earnings—which is highly suitable for understanding the dynamics between these variables (Cooke, 2006). This enabled comparison of predivorce and postdivorce earnings. Studies on family and divorce in Israel are rarely based on panel data (but see e.g. Flug et al., 2006; Raz-Yurovich, 2013; Zussman & Frish, 2007). As opposed to crosssectional data, our microlevel panel data allowed us to compare the effect of an event, such as divorce, on earnings and other aspects of life. It also enabled us to establish a time order between explanatory and dependent variables (Oppenheimer, 1997). Second, NII and Tax Authority earnings information is subject to less measurement error than are self-reported earnings (see Tamborini et al., 2012). Third, as divorce rates in Israel are relatively low, a large dataset, such as the census data, provides a sufficient number of cases. Nevertheless, this data source has two main drawbacks. First, it does not include annual information on several independent variables, such as level of education and number of children. Second, some individuals included in the 1995–2008 combined censuses did not appear in the NII data.1 Therefore, our sample represents full- or part-time salaried mothers who were in both the combined census file and NII records (including women who worked only part of the year). Analytic sample and research strategy The analysis was designed to identify change in mothers’ earnings before and after divorce in different periods. Therefore, we restricted the sample to salaried mothers aged 18–45 who were living with 1

Either the CBS was unable to locate the person in the NII and Tax Authority data, or that individual had no income. To avoid confusion between the two groups of missing data, we restricted the sample to salaried mothers with valid earnings data (for a similar strategy, see RazYurovich, 2013).

226

Figure 1. Time frame for analysis of predivorce and postdivorce earnings. Source: Tamborini et al. (2012), Figure 1, p. 72.

their husband in the same household at the beginning of the research period (1995) but had divorced between 1996 and 2008. The value of this variable was obtained from the Civil Registry of Divorce, which contains information on all couples who divorce in any given year in Israel.2 Since the study focuses on income from paid labor, we analysed mothers listed as full- or part-time salaried employees in any portion of 1995. Annual income was based on NII and Tax authority data. Since, until 1998, these data have addressed only salaried employees (whereas the income of selfemployed individuals was unreported), and since there were no data for mothers who were out of the labor market during a given year, we limited the analysis to mothers who were salaried employees at the beginning of the study (76.9% of all wageworking women in 1995 and 84.9% of all wageworking mothers in 1995). As the cohabitation rate is low in Israel (in the 1990s, it amounted to 2–3% of women in the relevant age range; Fogel, 2005), the sample based on married mothers is still representative of Israel’s population. Ultimately, the analysis was based on 1,173 salaried mothers aged 18–45 who had divorced during the study period (out of 8,442 salaried mothers who were married in 1995). To assess changes in labor earnings longitudinally, we compared each mother’s annual wages in the calendar year before the divorce (T 2 1) to her annual wages one (T 1 1), two (T 1 2), and three (T 1 3) calendar years after the event (see Figure 1). The analysis examined only mothers who divorced between 1996 and 2008, each of whom was followed during a five-year observation window. Research variables

Dependent variables. To assess changes in labor earnings longitudinally, two dependent variables were examined. The first was proportional earnings change, defined as a mother’s log annual earnings at T 1 1 minus her log annual earnings at T 2 1. We repeated that calculation for T 1 2 and T 1 3. The 2

Although separation date is often used rather than divorce date (Tamborini et al., 2012) as initiating the marital dissolution, the data we utilised did not include separation dates. Int J Soc Welfare 2016: 25: 222–234



second dependent variable indicated whether a mother’s earnings were at least 30% higher after the divorce (1 5 yes, 0 5 no). Following Tamborini et al. (2012), we selected a 30% threshold to identify an increase in earnings that went beyond wage growth and increment increases associated with work experience. All earnings were pretax and pretransfer earnings from the labor market, and were adjusted to 1995 NIS using the Consumer Price Index.

Independent variables. To measure the welfare policy period, we created a dummy variable that indicates whether the divorce occurred in the 1996–2003 period (coded 0) or the 2004–2008 period (coded 1). In the regression analysis (see Data analysis), the coefficient of this variable indicates if the average change was different in the two periods, controlling for other variables in the model. To test the robustness of results, we repeated the regression analysis using a close but different cut-off point with regard to policy period (2002 instead of 2003). Although policy changes related to single-parent families started in 2003, a general change in family policy began in 2002 (Doron, 2005). The analysis yielded similar results. In addition, we re-ran the regression analysis, measuring year of divorce as a continuous variable. The analysis confirmed the robustness of key effects (see Findings). The study controlled for variables found to be important in previous studies (Raz-Yurovich, 2013; Tamborini et al., 2012), including socio-demographic and family measures. We thus included the mother’s wages at T – 1 and her ex-husband’s wages at T – 1, as well as the mother’s educational level, examining the highest qualification she had attained by 1995: less than high school (low education), high school without matriculation, high school with matriculation, postsecondary education, and college education (the reference category). Family characteristics included: mother’s age at divorce (time T); number of marriages, distinguishing between first (coded 1) and additional marriages (coded 0); marriage duration (in years) and number of children in 1995. Because we have data only on the number of children in 1995 (and not their age), and the aging of children over time could affect the observed earnings of mothers, and because mother’s age is related to her children’s ages, we also reran the analysis on a sample of mothers aged 18–35 (n 5 922). Results indicate the robustness of key effects (not shown). Nonetheless, we interpreted the results in keeping with this shortcoming. We also controlled for the effect of remarriage by including three dummies indicating whether the mother had remarried by T 1 1, T 1 2, and T 1 3 (1 5 yes; 0 5 no). Each dummy was included for the appropriate year of the outcome.

Lastly, we measured ethnicity by the women’s country of birth or, for those born in Israel, by their parents’ country of birth, divided into ethnic categories (Okun, 2004; Raz-Yurovich, 2013): Asia-Africa; Europe-America (the reference category); secondgeneration Israeli Jews; immigrants from the FSU as of 1989; and Israeli-Palestinians. As we had too few cases of Israeli-Palestinian salaried mothers who divorced, we excluded them from the analysis. This is in keeping with national data (CBS, 2013) which indicate low divorce rates in this group. The Appendix presents descriptive statistics of the research variables for the sample. Data analysis To examine changes in mother’s earnings before and after divorce across periods, we first used descriptive statistics of median annual earnings and percentage change in annual earnings one year prior to the divorce and one to three years after the divorce in the two policy periods. Second, we utilised two types of multivariate regression techniques: (1) OLS regressions estimating the log difference between a mother’s earnings predivorce and postdivorce (at T 1 1, T 1 2, and T 1 3); and (2) logistic regressions estimating the log odds that a mother’s real postdivorce earnings (at T 1 1, T 1 2, and T 1 3) were at least 30% higher than her earnings at T–1. These analyses should be treated as descriptive regressions (Ginther & Pollak, 2004), as they are not intended to evaluate causal relationships. This kind of analysis furthers understanding of the conditions that differentiate between patterns of change in mothers’ postdivorce earnings (for a similar analysis, see Tamborini et al., 2012). To identify changes in earnings following divorce across the two periods, we included a period dummy variable in all models. A sensitivity analysis, estimating the change in earnings through a regression analysis in the two periods separately, yielded qualitative similar results. We also examined interactions between policy period and all other independent variables to control for the possibility that an independent variable may have a different effect by period. Only interactions with 0.10 significance levels (see Tamborini et al., 2012) that were consistent across the three years (T 1 1, T 1 2, and T 1 3) were retained in the model. Findings Descriptive analysis For mothers who divorced between 1996 and 2008, Figure 2 shows median earnings one year prior to divorce and one to three years afterwards, in the total sample and over the two periods. As the figure


227

Herbst & Kaplan

Figure 2. Predivorce and postdivorce median earnings, for divorced salaried mothers, by period (in NIS deflated to 1995 price levels); 1995–2008 combined Israeli census data. Note: The mean differences between the years are statistically significant by t-test for T 2 1, T 1 1, and T 1 2.

shows, mothers generally tended to increase their earnings one to three years after divorce. Further, mothers who divorced in 2004–2008 started from significantly higher levels of predivorce earnings than those who divorced in 1996–2003. One and two years following the divorce, these differences decreased but remained significant. However, both groups reached about the same level of earnings three years after the divorce, as differences were no longer significant. Figure 3 shows the cumulative distribution of the percentage change in earnings between T 1 1 and T – 1 among divorced mothers in the total sample and comparing the two periods. Regardless of period, the earnings levels of the majority increased following divorce. Around 80% experienced a postdivorce real earnings gain of at least 10%, and about 16% had a gain of more than 90%. About 14% had lower earnings one year following the divorce than one year prior to the divorce.

In addition, significant differences were found between the two periods, as indicated by different cumulative distributions. While about the same percentage of divorced mothers experienced a decrease or stability in their predivorce and postdivorce earnings, the increase in earnings was higher in 1996– 2003 than in 2004–2008: 28% of mothers who divorced between 1996 and 2003, as opposed to 40% of mothers who divorced between 2004 and 2008, experienced an increase of